U.S. Small-Business Employment Growth Slows In 2015
While U.S. small businesses added jobs in 2015, they did so at the slowest rate since 2011. The Paychex/IHS Small Business Jobs Index shows job growth decreased 0.05 percent from November to 100.37 and 0.19 percent from 2014.
“December 2015 marks the 51st consecutive month job gains have exceeded the pace of our base year over a decade ago,” says James Diffley, chief regional economist at consulting firm IHS. “Nevertheless, 2015 was the softest year for small-business employment growth since 2011.”
Martin Mucci, president and CEO of human capital management solutions provider Paychex, adds, “The national index steadily trended downward throughout much of 2015. What that tells us is that while small businesses certainly added jobs this year, the pace at which they did so slowed.”
The index’s decrease to 100.37 in December was consistent with a downward trend observed since it peaked in April 2014 at 101.26. Though expansion is still evident, the 12-month growth rate is -0.19 percent, with gains continuing to slow each of the past five years following the low point of the recession. There were increases in 2015’s first quarter, followed by consecutive declines in the second and third quarters, capped with little movement in the fourth quarter.
On an industry-by-industry basis, the index found that its Other Services (except Public Administration) category, which includes a range of offerings from repair and maintenance to personal and laundry services, remains the top-ranked industry, improving to 104.35 in December. Construction followed at 101.66. Rising to the third spot among industries at 100.49, Leisure and Hospitality improved 0.26 percent in December. Ranked last among the industries tracked by the index, Manufacturing has been the weak spot of the U.S. economy due to the high value of the dollar. The Manufacturing index is down 1.16 percent over the past year and fell below 99 for the first time in five years to close 2015.
For more on the Paychex/IHS Small Business Jobs Index, including regional and metropolitan data, click here.